The European Commission has taken action in two specific areas to improve the efficiency of the EU single market for retail investment funds. These funds, known as 'UCITS'[1], provide consumers with access to professionally managed investments on affordable terms and now account for over €5500 billion of assets. First, the Commission has adopted legally binding guidance on whether new financial instruments can be included in investment funds. Second, it has issued guidance on how host country authorities should exercise limited scrutiny powers when UCITS are notified for sale in their country. These clarifications will ensure consistency in the authorisation and marketing of investment funds across the EU. The Commission will propose a more fundamental redesign of the EU 'passport' for investment funds later in 2007.